Natural gas consumption, energy efficiency and low carbon transition in Pakistan

Highlights: • LMDI decomposition method measures the impacting factors of Pakistan's NGC. • Sectorial energy intensity is applied based on LMDI approach. • The economic and energy factors are estimated for new way policy-makers. • Per capita GDP and population are most imperative driving factors in rising NGC. • Pakistan should focus on future energy security issues with energy and technology. Natural gas consumption gradually rises in all sectors for being a relatively economical and clean fuel compared to other substitutes. In a step towards adopting environmentally friendly fuel and to save foreign exchange, as the domestic gas reserves could be utilized. Under policies, Pakistan's natural gas consumption is expected to commensurately rise, which will significantly impact environment, energy security and the economy. This study applies the Logarithmic Mean Divisia Index and sectorial Intensity Decomposition Methods to estimate natural gas consumption factors. The objective is to analyze some relevant novel factors (i.e., fossil energy structure, non-renewable energy structure, energy intensity, GDP per capita, and population) that might give a new-way for policy-makers. Results show: (1) GDP per capita and population are most imperative driving factors in rising natural gas consumption. The energy factors are the most significant factors followed by per capita GDP, population, energy intensity, and industries. (2) Energy intensity in transport sector contributed highly to energy intensity. (3) The scenarios predicted that the average yearly growth rate of gas consumption is predicted to approximately 24.37% from 2020 to 2030. Prediction highlights that sustainability and energy security could be ensured by regulating environmental policies and technical progress. Further targeted policies are provided.